Zeldes, Haeggquist & Eck, LLP Announces Investigation of NQ Mobile, Inc.
Zeldes Haeggquist & Eck, LLP, a shareholder and consumer rights litigation firm, has commenced an investigation into claims on behalf of purchasers of NQ Mobile Inc. (NYSE: NQ) (“NQ or the “Company”) securities concerning potential violations of the Securities Act of 1933 and the Securities Exchange Act of 1934 by Company offices and directors during the period between May 5, 2011 through May 2, 2013 (the “Class Period.”)
Zeldes Haeggquist & Eck’s investigation concerns whether NQ issued materially false and misleading statements regarding the Company’s business and financial prospects during the Class Period and in connection with the Company’s May 5, 2011 initial public offering (“IPO”).
Founded in 2005 and headquartered in Beijing, PRC, NQ provides various mobile Internet services. The company was formerly known as NetQin Mobile Inc. and changed its name to NQ Mobile Inc. in April 2012.
On May 5, 2011 NQ conducted its IPO of American Depositary Shares (NYSE:NQ). The shares were priced at $11.50 per share. Following the IPO, and during the Class Period, NQ share prices increased significantly, climbing to nearly $25 per share in October 2013.
Then, on October 24, 2013, equity research firm Muddy Waters LLC initiated coverage on NQ with a “Strong Sell” rating and a projected target price of less than $1. Among other things, Muddy Waters’ research report states: (i) at least 72% of NQ’s reported $32.2 million in 2012 China security software revenue is fraudulent, NQ’s real security revenue was $2.5 million to $7.7 million; (ii) NQ’s largest customer is actually an empty shell company controlled by NQ; (iii) NQ’s real market share in China is only about 1.4%, versus the approximately 55% it reports; (iv) NQ’s international revenues are wildly overstated; and (v) the vast majority of the $127.9 million cash and investments NQ reported having as of December 31, 2012 is not actually in the Company’s accounts.
Upon the release of this information, on October 24, 2013, NQ shares declined 47% to $12.09 per share from $22.88 per share, on unusually heavy volume of 29.3 million shares traded.
What You Can Do
If you purchased NW American Depository Shares during the Class Period and/or in the Company’s IPO and you wish to discuss this investigation, or have questions about this notice or your legal rights, please contact attorney Amber L. Eck at 619-342-8000, or by email at email@example.com. There is no cost to you.
Zeldes Haeggquist & Eck, LLP is a full-service law firm which brings major class actions nationwide on behalf of defrauded investors and consumers and handles a variety of complex business litigation matters. Please visit www.zhlaw.com or our blog for more information about the firm.